- Carl B. Watson, Ph.D.: [00:00:00] Things are moving so rapidly, the organization's information pump is too damn slow. By the time managers get information, build perspective, the world's already changed. Their perspective is wrong. They're making choices. They're always three, four, five steps behind, because the world has changed too rapidly. So you have to push that out further, that information processing, that decision-making to the edge of the organization.

- Megan Alexa Watson: This is a podcast for leaders who want to drive change in their organization without losing sight of the people behind it, the purpose that fuels it, or the principles guiding it. I'm Megan Watson, joined by Carl Watson, and this is The Watson Standard.

 There's a lot of conversations right now about, being in a time of the evolution of the workplace, especially in tech, where AI has created a situation where [00:01:00] 'what is next?' Feels like a big question mark for a lot of leaders in a lot of organizations.

- Carl B. Watson, Ph.D.: And it's coming at everybody fast. It's changing literally weekly. And people are really struggling keeping up. 

- Megan Alexa Watson: I was chatting with a coworker the other day, and they were talking about planning by fiscal years is completely done. Planning by quarters is pretty much done.

Months are nice... but now we have leaders asking people, "Yeah... what have you done for me in days and hours?" 

- Carl B. Watson, Ph.D.: Yeah. Yeah. 

- Megan Alexa Watson: I'm curious as we think about long-term strategic planning, like, how does somebody even get their head around what it means to develop a strategic plan in a world that's moving so fast and is so unknown?

- Carl B. Watson, Ph.D.: It's just compressed. This problem's always existed. The short-term, long-term has been a paradox. It's always been a paradox. What we're experiencing now is that the long-term aspects of leading organizations have become more uncertain. It's more difficult to see [00:02:00] whether any long-term plans play out, but that paradox has always existed.

And so instead of treating it like it's something that is completely de novo, that we've never faced this phenomena before ... let's say, this is not new. 

- Megan Alexa Watson: Yeah.

- Carl B. Watson, Ph.D.: For me, that's the crux of the challenge. You have to have a point of view. If you don't have a direction or an intent or at least something that is guiding your behavior what you're gonna do is random.

And so that's what long-term plans are intended for. They give you direction and, and intentionality and focus, and so how do you actually maintain some, some directionality while adapting rapidly...

- Megan Alexa Watson: ... in the moment.

- Carl B. Watson, Ph.D.: In the moment. Yeah. Yeah. Exactly that. 

- Megan Alexa Watson: I wanna circle back to the focus of what people are doing short-term versus long-term.

I was chatting with a really great leader that I respect deeply the other day, and they were talking about the myth of having a legacy team. And so, in organizations that are trying to think through how are you [00:03:00] making sure that the work at the core, the legacy work continues to move and be effective, while trying to think through the work that needs to be done that allows you to move the transformation forward, so from the legacy to what's next, and trying to do work to start to craft out and envision what's next.

And the way she put it, I love so much. Somebody had mentioned, they said, "I gotta figure out how to get my legacy team on board and get them to be able to drive this work." And she said, "No, no, no, let me stop you right there. You do not have a legacy team. You have legacy business or legacy work."

"But as a leader, if you think of your, your people as legacy team versus new team, you've already failed them in leadership. And so your ability to recognize that everybody has the capability to work across all three of those lenses of the work, and it's on you as a leader to help get their mindset shift into the right place to be able to [00:04:00] switch between those as needed."

- Carl B. Watson, Ph.D.: Yeah. 

- Megan Alexa Watson: I just, I love the way she put that. 

- Carl B. Watson, Ph.D.: Yeah. That's beautiful. I hear two additional things in that, right?

- Megan Alexa Watson: Yeah.

- Carl B. Watson, Ph.D.: 'Cause we're talking about short-term, long-term. I hear an additional aspect around a legacy business, which is the thing that generates our current revenue, our current profits, versus what can generate profits in a new business environment or in environments that are changing or leveraging new technology, or new customer needs. It's similar but different than short-term, long-term problem.

- Megan Alexa Watson: Fair. Fair.

- Carl B. Watson, Ph.D.: Okay? And then I also hear in that, which I think is really great is really a caution or actually a strong pushback about thinking about people as either dinosaurs essentially... versus ... you know... the thing that's gonna survive. 

- Megan Alexa Watson: ...functional things that can grow and develop and learn?

- Carl B. Watson, Ph.D.: Right, right. Everybody should be thought of as having the ability to switch between those modes. Because the challenges around how fast things are moving are [00:05:00] so compressed right now. Having that mindset be part of everybody's thinking actually can unleash the organization's ability to adapt more fluidly across the entire system. I love that. 

- Megan Alexa Watson: That was where I was gonna go next into short-term, long-term... one thing that we tell leaders often is to galvanize change, to galvanize transformation, you have to have a clear vision of where you're gonna go. And, in a world where there's a lack of clarity on what is possible, how you set that vision to be able to keep people motivated in a short-term spin, "Hey, we're gonna do this sprint. We're gonna do this quick cycle and burn through something very quickly," without them having the vision of what it accrues to. I'm curious, as you think about that, how do you play with the tension of really getting people galvanized around something tangible and near-term versus something that feels sort of mystical or behind a cloud or a curtain that is longer-term from a [00:06:00] strategic perspective?

- Carl B. Watson, Ph.D.: Yeah, it reminds me of a challenge that startup leaders have, like entrepreneurs who at early stage of the business where they have the challenge of they're really cycling through lots of different approaches to solving a set of business problems and customer problems before they land on the set of ideas that really fuel the business forward.

Right? I used to do a lot of work in that startup space. And the best of those leaders, in a lot of the interviews I did, really had the ability to maintain this idea that we have this goal. We wanna fundamentally shift this idea. One of the businesses in healthcare I worked with were trying to deal with the cacophony of technologies in an hospital environment, and a lot of complications and deaths happen in the handoff between technologies and hospitals. And the goal was to solve that problem, to reduce deaths by stitching together technologies in the hospitals more fluidly.

That was the goal, reduce [00:07:00] deaths through stitching together technology. And trying to find different ways to approach that problem there were a lot of short-term issues in that. But that idea was the evergreen idea. Having a very specific objective, but is not a short-term problem we're solving for. It's this bigger idea. And then you flip through ways of trying to solve that problem and get closer and closer to that. And even when you get to something that actually works in the sense of it, it brings you closer to your idea, that's still a big idea, right?

I think part of the challenge with a lot of organizations is that their goals and their missions are really prosaic. They're just really on the ground, right? They're like, "We wanna be the best in the customer satisfaction", "or leading in the market," or things. Though that doesn't inspire people. That doesn't help people figure out what's important versus what's not important. You have to have something like, "We're gonna reduce deaths through stitching together disparate technologies in hospital systems." That's specific, [00:08:00] it's bold, it's difficult, and it's important to people.

- Megan Alexa Watson: Yeah. Yeah. It connects me back to conversations we've had around adaptive leadership, and the idea of technical challenges versus adaptive challenges. And what I'm hearing from you in that is the mission ideally should be an adaptive challenge.

It should be something that there isn't a clear process, there aren't clear steps, there isn't an individual subject matter expert who can just get it done, and it may never be done. And being able to measure it and gauge it, while there are certainly a lot of perspectives on, and there's ways you can sort of chop it up into little pieces... the reality is it is something that is always driving the organization and the individuals forward, to keep them motivated in the long term.

The other piece that I'm picking up from what you're saying is, in a world where everything is shifting so rapidly, the ways that people are leveraging technology to solve problems, the way that teams are working together [00:09:00] to solve problems in a broad reaching or way forward-looking adaptive challenge type mission, there's always going to be a new piece to the puzzle.

There's always gonna be a new, like, "Oh, this wasn't a problem before, but now that this technology is in place, this is now a huge problem," or, "This wasn't an issue before, but now that this policy changed in the larger environment, there's a new piece to this puzzle that we have to solve."

And so you're able to continue to create these incremental wins that are leading to that broader journey, but doesn't lead to it feeling insurmountable- 

- Carl B. Watson, Ph.D.: Yeah ... 

- Megan Alexa Watson: ... and not achievable. I'm big on aspirational missions, and yet, how do you help the team see that they're chipping away at it and making progress along the way?

- Carl B. Watson, Ph.D.: Absolutely, and I do think that's important. It's very difficult to maintain motivation when your work keeps flipping. When the thing that you're working on is, is less [00:10:00] relevant or no longer relevant, or you have to pivot constantly.

In this environment, the pivot is the point, right? If you don't pivot, you can't reach the goal, and so how do you say, "Hey, this is not wasted. I've learned things. I know things I didn't know before, there are pieces I can carry forward... but I need to pivot. That's still my goal. I know what that is, and I can still make progress to get there."

- Megan Alexa Watson: You are talking about one of my favorite topics, the pivot. How do we help individuals come to recognize that sometimes these organizational pivots feel personal, but they are not personal.

It is not a sign of failure. I think so many of us have been raised in workplaces where being able to deliver on the thing you originally contracted for is the gauge of success or failure. In today's day and age, as things are shifting, new data is coming in, people are iterating and testing things and finding out, 'oh, that thing actually doesn't work the way we thought it was gonna work'. The need to embrace and get [00:11:00] comfortable with those pivots, that is a mindset challenge if I ever heard of one.

So then my brain goes to two places, and one in particular I'd love your thinking on. One is around, what are the organizational or systemic things that need to be in place to help an organization be able to embrace, reward performance in a high pivot, high change, high 'fail and let it go, do the next thing' organization or culture?

And then of course, how do we think about how do individual leaders help create that dynamic or that culture on their team where it still can feel like success even if something doesn't launch or gets pulled from the shelf or didn't work the way we thought it would once we took it out of the sandbox?

- Carl B. Watson, Ph.D.: Yeah. It brings up two ideas, and I don't know if this answers your question or we can sort of work on it to get there. I think the first thing is being able to separate, where we know where cause and effect relationships are clear. When [00:12:00] cause and effect relationships are clear, then you can attach a specific deliverable, a tangible product to a set of outcomes, because you know if we do this thing, we're likely to get these results. 

- Megan Alexa Watson: Yep. 

- Carl B. Watson, Ph.D.: And part of the challenge with today is cause-effect relationships- ... are less clear, right? 

- Megan Alexa Watson: Less clear-- blown up.

- Carl B. Watson, Ph.D.: That's right

- Megan Alexa Watson: ... let's be real. They are blown up. But go ahead. 

- Carl B. Watson, Ph.D.: And so if we can understand that, okay, there are a set of things where we think cause and effect relationships are clear, then we can have more traditional task-reward relationships. Right? 

- Megan Alexa Watson: Okay. 

- Carl B. Watson, Ph.D.: When cause and effect relationships aren't clear, part of your goal has to be to understand the new dynamics in the scenario, and that should be rewarded in itself. So you can have actually a failure in terms of what you actually tried to accomplish, if that failure clarifies cause and effect relationships in some meaningful way, that should be rewarded. And that is a challenge for leaders to shift their [00:13:00] thinking from task reward which is a traditional setup, to experiment - success reward. And a successful experiment isn't always the result you expected.

Your successful experiment is you understand more than you did before doing the experiment whether the outcomes are what you expected or not, and that's a very different mindset in terms of how you go about doing things. There are a set of areas where we just don't know enough or they're breaking down rapidly and we're gonna have to reward those in a different way. 

- Megan Alexa Watson: One of the things that I'm grappling with a lot of the leaders that I work with is what does it mean to lead and manage in these moments at the individual level?

One thing that I've started to reflect on is sort of, I'm not gonna call it like prompt leadership or prompt management, as tempted as I am to do that. But just in the way, just in the way that we [00:14:00] need to learn how to engineer the right prompt to get the right result From, you know, from an agent.

Just like we need to be super clear on what success looks like, just like we need to be able to articulate what are the sources and the inputs and the guardrails, and what do we want them to consider or not consider. The level of precision that I think is needed from management in particular at this time to be able to be super clear about what success looks like, I think is hitting a bar that most managers have not had to experience before.

'Cause sort of to your point,

i'll use an example to bring it to life. I was working with a team member who the overall outcome that we were trying to drive to was getting a set of stakeholders aligned around the way we were gonna articulate the value add of something that we were delivering. As we were contracting the work and I was getting them started, one of the [00:15:00] things that I mentioned, I was like, "I need us to be really clear about the fact that our stakeholder set might change from the beginning of this work, to the middle of this work, to the end of this work, depending on what approach we take."

And I saw her face go pale as she was like, "How the heck am I gonna be able to know if I'm successful if that's the case?" Like, stakeholder management is hard enough as it is, but then add changing stakeholders and shifting stakeholders. And in that moment, it hadn't even occurred to me that I hadn't articulated to them, "Success is having it ready to take to the right stakeholders. When you hit that, we will claim that as success. Whether or not we're able to get in front of those stakeholders and then influence them, that's the next increment of progress. But know that at this stage I'm only holding you accountable for having done the work to get us ready to have that conversation."

Chopping it up into those smaller pieces, giving them the win, and then being able to contract again for what [00:16:00] the next step is... it is something that I've been reflecting a lot on, even in my own sort of leadership style.

- Carl B. Watson, Ph.D.: I'll start with this idea that I think partly is leaders believe they have to have all the answers. And I believe it's also a collaboration with your teams as opposed to I'm going to literally write the prompt- 

- Megan Alexa Watson: ...yes, and send you off and good luck!

- Carl B. Watson, Ph.D.: And send you... right, right. This is a collaborative activity.

- Megan Alexa Watson: Yeah, yeah. 

- Carl B. Watson, Ph.D.: Minimally because the words and ideas that you use may not resonate fully with the person who's actually gonna have to deliver against that. And so they have to actually reinvent it in their own way of thinking about it, in their own language, so that it actually makes sense for them to actually be able to get it done. So that collaboration is super important. 

- Megan Alexa Watson: Yeah. I'm actually gonna jump in on you there. That for me is what was the unlock for me seeing the prompt as the metaphor, because I keep wanting to put something into an agent, say it in my words, and think it can go solve it without [00:17:00] ongoing interaction. And I've had to learn it's gonna spit something back at me, and I'll be like, "No, that's not what I meant at all." And then I have to write it a little different, and then it spits something else, and I was like, "I totally had no idea that you were gonna take that word that way. Now that I know that, let me give you this other thing."

So the back and forth with agents, has actually strengthened my manager capability because I'm not just shipping things and saying, "I'll see you in a month when you have it solved."

- Carl B. Watson, Ph.D.: That's expensive, the way, doing it that way.

- Megan Alexa Watson: Costs a lot of tokens. Exactly. Fair. Fair. 

- Carl B. Watson, Ph.D.: But the point being is very valid.

Give you an example... in my work, we do a lot of organizational diagnostics. The teams I work with often think about either the research itself, the interviews or the survey or focus groups, whatever, as the deliverable.

And my point of view is that the goal is for whatever group of executives to understand, have insights into the [00:18:00] organizations, or into their talent, or into the state of the health of their business that they didn't have before. So there's two flip sides to that.

One is we develop a point of view when we do organizational diagnostics. So we definitely start somewhere ... we have an opinion. So the first thing is my opinions matter, but they're not what's important. And so of course, I have an opinion. I have a hypothesis. I wanna test that hypothesis. It's super important because it shapes how the work evolves, and it shapes what you look at and what you don't, all these things. So it's super important, but my opinion doesn't matter 'cause it's actually the client -- their opinion matters, and their decision about what to do with that is most important. And sometimes we'll get to a point where the team will wanna say, "Well, they didn't decide what we thought they should decide." And I'm like That's not the important question, right? The important question is, [00:19:00] did they understand the critical information, the critical insights so that they can make a good choice?

That is the outcome that is important. Their decision is their job to make based on their business savvy, the pressures that they're wrestling with, and what's important for them to actually solve for. Our job is to get them to understand, to be clear about what the situation is. They have the insights that we have once they can get there.

Outcome thinking, in this case, is the executives have new insights about their business, about their leadership team, or about their organizations that will help them make good choices.

Sometimes you'll get to the point where you deliver something and the executive doesn't get it. They just don't. That's a 'me' problem. That's a professional problem about [00:20:00] delivery that myself and my team has. That's not the executive's problem. 'Cause if I make it the executive's problem, we'll never get anywhere. And so I haven't achieved the outcome yet, even though we've delivered something.

So you go back and say, "How do we reshape the information? How do we add color, texture or present it in a way that clarifies it so that they get it?" And once they get it, then you have to let it go, 'cause that's when your job is done, and the executive's job takes over.

Being clear about what your role is, being clear about the outcome versus the deliverable. 

- Megan Alexa Watson: I'm sitting here thinking about all the times that we've talked about organizations being data-driven up until now, and like I will own, I have some pretty high skepticism around how many data-driven organizations are truly data-driven. But as I'm listening to you, it feels like this moment may actually spark sort of a renaissance in data-driven [00:21:00] leadership because it is all about, what new information do you have? What new insight do you have? What new signal do you have? As you were talking before about trying things and failing, the success of the fail is you now have new data like, 'Yep, doing it that way doesn't work. Next.' And so there's something about that at least for me, feels so much more compelling as we are asking people to be able to articulate value and capture of the insights. The articulation of the insights becomes the currency, and then the capability is being able to ingest those insights and do something meaningful, thoughtful, strategic, scalable, sustainable with them.

- Carl B. Watson, Ph.D.: One way of thinking about an organization is as an information processing system. And in traditional organizations, that is primarily the remit of [00:22:00] management. And so managers sit in rooms and they-

- Megan Alexa Watson: ...and wait for information to be given to them.

- Carl B. Watson, Ph.D.: Right. Their teams deliver information, and they develop perspective and direction from that information. There's two things that are really driving that as a difficult problem. One is because things are moving so rapidly, the organization's information pump is too damn slow. By the time managers get information, build perspective, the world's already changed. Their perspective is wrong. They're making choices. They're always three, four, five steps behind, because the world has changed too rapidly. So you have to push that out further, that information processing, that decision-making to the edge of the organization. That's why we're flattening organizations, all that sort of stuff, right? 

- Megan Alexa Watson: Yep. Yep. 

- Carl B. Watson, Ph.D.: The other push is the availability of data and the ability to process that data real time because of the tools and technologies we have available to us, including AI, but not exclusively so. That's actually creating more [00:23:00] intelligence at the edge as well.

And so those people at the edge of the organizations, closer to the customers, closer to the action of the organization, are more equipped to build perspective, make choices, and actually do what leaders have traditionally done in organizations. And so the question becomes, and actually a leader asked me this once... She said, "Well, what do I do now?" Right?

- Megan Alexa Watson: Yep, yep.

- Carl B. Watson, Ph.D.: She said, "What do I do now?" And so I have two answers to that question. The first answer is empower your teams. Give them the support, and authority, and runway to do what they can do now that they weren't able to do when you were starting out, what you weren't able to do when you were starting out. Yeah. Just because you couldn't do it when you were starting out, these... the situation now is different for people who are at the edge of organization today than, in the past. And so [00:24:00] your first job is to empower them and give them what they need to be able to make those choices and move faster than they can move if they're constantly reporting back to you and waiting for your answer.

The second thing, I think this is interesting and harder, and that is how do you analyze the choices that people are making as they're responding to business challenges locally so that you can build a broader perspective across a set of decision makers? Like, top team leaders have done this for decades.

But you have to do that faster than before. There's primary data. You're getting information about sales, and about, customer satisfaction, about, returns, all this other stuff. It's primary information that people at the edge are making choices at. I wanna know that primary information.

I also wanna know how people are choosing to deal with that information in real time on the ground, [00:25:00] and then I can have a combined perspective, a perspective that, considers choices that people are making, as well as the raw data that we're used to getting, or even the perspective that people bring back, because that's actually different.

The choices that people make and the perspective that they use to describe those choices are actually different ideas. even if we try to make them the same, they're actually not because power warps communication. Just the way it is. You can actually improve your leadership by seeking to understand the choices that people are making through direct observation, as opposed to just the digested form of that when people come back to you, come back to the leadership team and express, "Here's what's going on. Here's why we did what we did. Let me explain it to you," which is both accurate, and inaccurate. And some of the inaccuracies are actually useful because it highlights, it emphasizes certain things that are important [00:26:00] that are weak signals that they're amping up. But it's also, important for leaders try to, balance between information that's pre-processed versus information that they can get more, more directly.

- Megan Alexa Watson: I love that, and it's surfacing for me a conversation that we need to have in a future episode, how do we think about the capabilities and mindsets that are critical for talent to be successful in that sort of environment. Because the first thing that I go to is something that I know you and I enjoy talking about a lot, which is, how do you think about human judgment and where that comes into play?

- Carl B. Watson, Ph.D.: Here are five practical takeaways. One, anchor the organization in a durable purpose while keeping the path flexible. Two, leaders should help everyone pivot among three modes of work: sustaining today's business, advancing the transformation, and exploring [00:27:00] what comes next. Three, reward learning when uncertainty is high. Four, contract work in smaller increments and define success together. Five, move decisions closer to the action, then learn from the choices people make. While this doesn't give you all the answers, these five takeaways are an important foundation when leading in uncertainty.

- Megan Alexa Watson: And that's it for this episode of The Watson Standard. We've shared some things to think about, talk about, and put into practice. Follow the series and join us next time as we continue redefining leadership and redefining organizations.